UNITED STATES v. FUREY

May 14, 1980

UNITED STATES OF AMERICA V. RONALD FUREY, JOSEPH DiLUZIO

The opinion of the court was delivered by: BECHTLE

MEMORANDUM OPINION AND ORDER

Presently before the Court are the motions of the defendants Ronald Furey ("Furey") and Joseph DiLuzio ("DiLuzio") for a new trial and/or judgment of acquittal, pursuant to Fed.R.Crim.P. 33 and 29(c). After careful review of the arguments of counsel, the factual record of this case and the applicable judicial authority, the Court will deny the defendants' motions.

This case focused on a residential development project commonly known as "Ravenscliff," which is composed of approximately 126 acres of property located in Radnor and Newtown Townships in Delaware County, Pennsylvania. Three companies were involved in the development project, including Ravenscliff Land Company (the land holder), Ravenscliff Development Company (the builder) and Roach Brothers, Inc. (the real estate agency selling the residential dwellings). All three companies are Pennsylvania corporations doing business in interstate commerce. Robert Roach is the president and majority stockholder in the companies and Lawrence Flick ("Flick") is the vice-president.

On July 21, 1978, Ravenscliff filed a subdivision plan for approval with Radnor Township. The plan provided for the immediate sale of a mansion house located on the tract and the subsequent construction and sale of single-family residences on the surrounding acreage.

The tax assessments on the Ravenscliff property that was to be subdivided was approximately $ 155,000, which was spread over five separate parcels. Due to the new subdivision plan, it became necessary to have a new assessment to reflect individual assessments for the new 100 lots on which the homes would be built.

In Delaware County, as in many other counties in Pennsylvania, the Tax Assessment Office establishes the assessments on properties located in the county. These assessments, established on a county basis, are then used by the various municipalities and school districts within the county to determine the actual tax by multiplying the assessment by the millage rate adopted by the local taxing authority. Needless to say, because the tax to be paid on a property by the landowner is a serious consideration for both the buyer and the seller, the assessment, resting at the core of that factor, looms large in the decision-making process as a real estate development progresses from raw ground to the settlement date with the buyer.

The details of the extortion scheme charged in the indictment, as outlined by the Government's evidence, were as follows: There were a series of meetings and telephone conversations between Furey and DiLuzio with Flick concerning what the tax assessment was to be for the developing Ravenscliff project. These meetings and conversations took place between October of 1978 and August of 1979. The evidence at trial revealed that at these meetings, and during various telephone conversations, Furey attempted to extort monies from Flick by reason of his official position as tax assessor assigned to Radnor Township and through the use of threats of adverse economic consequences to the development of Ravenscliff. Furey said that, unless certain money was paid to him by Flick, he would, by reason of his official position as tax assessor, cause a higher tax assessment to be placed on the Ravenscliff development than would be set if the money was paid. The great majority of the telephone conversations and meetings, excluding the initial October 17, 1978, meeting, were recorded by agents of the Federal Bureau of Investigation ("FBI") at the request of Flick but without the knowledge of the defendants. Flick had notified the FBI soon after the initial extortion attempt took place during an October 17, 1978, meeting between Flick, Furey and DiLuzio which had not been recorded. These tape recordings were offered at trial by the Government and played to the jury.

DiLuzio, according to the Government's evidence, was to act as an intermediary between Furey and Flick, passing the monies being extorted. DiLuzio was to be paid for his services.

The post-trial motions of the defendants raise several separate issues, which will be addressed by the Court individually.

I. Voir Dire Questions to the Jury Panel

The first ground raised by Furey concerns the Court's refusal to ask certain of Furey's proposed voir dire questions:

13. Does the fact that this case involves the alleged extortion by a tax assessor offend your sensibilities in such a way that it would prevent you from rendering a fair verdict based solely upon the evidence presented at trial?

14. Does the fact that this case involves misconduct by a public official render you unable to give a fair verdict based solely on the evidence at trial and not on any preconceived notions?

Furey contends that the Court's refusal to ask these questions of the jury panel constituted a violation of his due process right to a fair and impartial jury. Furey claims that, because the instant action is based on the Hobbs Act, 18 U.S.C. § 1951, which can involve the prosecution of public officials for the wrongful performance of their official duties, it was essential to secure an impartial jury devoid of any bias against political figures or public officials. Furthermore, Furey alleges that an inquiry into any hidden prejudices and biases was necessary in the instant action because the basis of his defense was that "while he was a public official he performed work which might have had an impact on his job, but for which he felt that he was entitled to outside compensation." Furey's Motion for New Trial and/or Judgment of Acquittal, at 2. This position, Furey argues, may have led to the appearance of a conflict of interest, causing some jurors to view his activities with a jaundiced eye due to what he calls the "post-Watergate mentality." The Court fully agrees with the defendant's contention that prejudices and biases, possibly as to political figures in general, is a permissible area for voir dire examination. However, the Court disputes the manner in which the defendant suggests this inquiry should have been undertaken. The question is whether the Court's questions sufficiently "probe(d the) hidden prejudices of the jurors," U.S. v. Wooton, 518 F.2d 943, 945 (3d Cir. 1975), or whether the proposed questions were further needed to ferret out the hidden biases of panel members.

Under Fed.R.Crim.P. 24(a),
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the trial court may, in its own discretion, conduct the voir dire of the jury panel. The form and manner of questioning of the panel are matters within the court's sound discretion, with the "widest discretion" necessary reposed in the trial judge. Kiernan v. Van Schaik, 347 F.2d 775, 778 (3d Cir. 1965). This discretion is necessary because, "(t)he determination of impartiality, in which demeanor plays such an important part, is particularly within the province of the trial judge." Rideau v. Louisiana, 373 U.S. 723, 733, 83 S. Ct. 1417, 1423, 10 L. Ed. 2d 663 (1963) (Clark, J., dissenting). See also U.S. v. Segal, 534 F.2d 578, 581 (3d Cir. 1976); U.S. v. Starks, 515 F.2d 112, 124-125 (3d Cir. 1975). The exercise of these broad discretionary powers of the trial judge is a ground for error only when basic notions of fairness have been violated on a constitutional scale. Hamling v. U.S., 418 U.S. 87, 140, 94 S. Ct. 2887, 2918, 41 L. Ed. 2d 590 (1974); Ham v. South Carolina, 409 U.S. 524, 527-528, 93 S. Ct. 848, 850-851, 35 L. Ed. 2d 46 (1973). For example, such rare violations have been found by the United States Supreme Court in the area of racial bias. The Court held in Ham, supra, and Aldridge v. U.S., 283 U.S. 308, 311, 51 S. Ct. 470, 471, 75 L. Ed. 1054 (1931), that racial issues were so intertwined with the factual and legal underpinnings of a case involving allegations of racial discrimination that specific inquiry as to possible racial bias among jurors was constitutionally required. See also U.S. v. Williams, 612 F.2d 735, at 736 (3d Cir. 1979).

Whether general questions will adequately expose possible bias and prejudice, or whether specific questions are mandated, depends on whether "the demands of due process could be satisfied by (a) more generalized but thorough inquiry into the impartiality of the veniremen." Ristaino v. Ross, 424 U.S. 589, 598, 96 S. Ct. 1017, 1022, 47 L. Ed. 2d 258 (1976). See also U.S. v. Taylor, 562 F.2d 1345, 1355 (2d Cir. 1977); U.S. v. Steinberg, 551 F.2d 510, 515 (2d Cir. 1977). For example, specific questions were not required in the case of a bearded defendant because of the court's inability "to constitutionally distinguish possible prejudices against beards from a host of other possible similar prejudices." Ham, supra, 409 U.S. at 528, 93 S. Ct. at 851.

Furey has cited, as supporting authority for the method of asking specific questions rather than general questions, U.S. v. Dellinger, 472 F.2d 340 (7th Cir. 1972), where the court stated:

The government argues that the court is obligated to inquire only into matters that would disqualify the juror for cause, and that the court's first group of questions were adequate to produce disclosure of any relevant prejudice. We disagree. The government's position must rest upon an assumption that a general question to the group whether there is any reason they could not be fair and impartial can be relied on to produce a disclosure of any disqualifying state of mind. We do not believe that a prospective juror is so alert to his own prejudices. Thus it is essential to explore the backgrounds and attitudes of the jurors to some extent in order to discover actual bias, or cause.

472 F.2d at 367.

Nevertheless, this Court finds that the possibly never-ending deluge of specific questions during voir dire is not constitutionally mandated in each case where generalized questions can substantially serve the same due process purposes. Supportive of this position is the holding of the Fifth Circuit Court of Appeals in U.S. v. Williams, 573 F.2d 284 (5th Cir. 1978), in which the court stated: "The trial judge's failure to ask the requested questions is not an abuse of discretion if his overall examination, coupled with his charge to the jury, affords a party the protection sought." Id., at 287 (emphasis added). See also U.S. v. Goodwin, 470 F.2d 893, 898 (5th Cir. 1972).

The Court also made the following general statement, to which responses indicating a lack of bias were given:

You have heard all of the questions I have asked, all of you. You have had a chance to think about some things. And obviously the Court doesn't ask all the possible questions that could be asked. And it is a question of trying to ask those questions that experience has told us are usually the most useful.

Now you have had a chance to think about the questions and many of you have furnished answers. Some of you have furnished a variety of answers.

N.T., Voir Dire at 114.

For these reasons, the Court determined that defense counsel's request that the Court ask proposed questions 13 and 14 should be denied because the subject matter of those questions had been sufficiently covered by the Court's prior questioning. See N.T., Voir Dire at 118-119. Any possibility of bias or prejudice existing in the minds of the jury panel concerning the political or real estate context of the case was sufficiently explored by the Court's questions and a more detailed inquiry was simply not necessary. Finding that no due process violation occurred, the Court also finds that the goals of judicial economy were served by its ruling. Furthermore, if there were any doubt as to the jury's impartiality, the Court's charge surely cured it:

In that regard, I mentioned to you earlier when you were called for jury service that your function, therefore, also by definition requires that you be impartial. That is, the case cannot be decided on the basis of sympathy or prejudice for or against any party in the case. The case can be decided only on the evidence.

N.T. 10-11.

Finally, of particular importance is the holding of the United States Supreme Court in Connors v. U.S., 158 U.S. 408, 15 S. Ct. 951, 39 L. Ed. 1033 (1894), in which the Court, in an older but still controlling opinion, held that the failure of the trial court to ask the following question during voir dire was not prejudicial to the defendants who were charged with election fraud: "Would your political affiliations or party predilections tend to bias your judgment in this case either for or against the defendants?" 158 U.S. at 414, 15 S. Ct. at 953. The Court held:

The Court finds that no exceptional circumstances existed which warranted the specific questions requested by the defendant. If a juror had stood up after the Court's general question about any other bias or prejudice, to which the aforementioned juror did rise, then further inquiry concerning that hypothetical juror's political bias or prejudice might have been justified, but no such juror responded in that manner, other than the juror with the real estate bias who was further questioned by the Court.

Therefore, for all the above reasons, the Court finds that in the instant action the refusal of the Court to ask the specific voir dire questions 13 and 14 proposed by Furey did not constitute an abuse of the Court's sound discretion and, therefore, did not rise to the level of a constitutional violation of the defendant's due process right to a fair and impartial jury as has been defined by judicial opinion.

II. Court's Charge as to Bribery

Furey and DiLuzio next contend that the Court erred in not giving Furey's proposed point for charge 9, which stated:

9. The government has charged the defendant under two theories of Hobbs Act extortion. One is that property was procured or attempted to be procured from the victim by actual fear of economic loss. This requires proof beyond a reasonable doubt that the defendant wrongfully used actual fear to induce Roach Brothers to pay him money. Unless the payment made, or attempted, was made under some form of compulsion, threat, duress, or coercion there is no crime under the Hobbs Act. The mere voluntary payment of money, unaccompanied by any fear of economic loss, does not constitute extortion. Such conduct might constitute bribery. Bribery is a different crime from extortion and the defendant is not charged with it. If you find the defendant guilty, you must do so on the basis of the evidence demonstrating his guilt of extortion only.

An integral part of the defense in this case was the contention that, if Furey did commit actions that were improper, he did so because he was induced to do so by Flick, the alleged victim of the extortion plot. Furey claimed that Flick initiated the meeting of October 17, 1978, at which time tax assessments for the Ravenscliff project were discussed, and that Flick initiated the arrangement for the payment of money in return for a favorable tax assessment by Furey. In the alternative, Furey argues that the mere passive receipt of money cannot be extortion because a public official, under the Hobbs Act, must have "initiated and induced" the payment from the victim. Furey claims that Flick induced the payment, thus constituting bribery on the part of Flick and not extortion by the defendants.

There were two separate theories raised in the indictment, those being that the defendants committed extortion by: (1) wrongfully acting under color of official right; and, (2) through the wrongful use of fear of economic loss. Under these two theories, three questions must be addressed: (1) whether the Court erred in not charging the jury on the crime of bribery; (2) whether the Court erred in not charging the jury on the "initiate and induce" language proposed by the defendants; or, (3) whether the Court erred in not charging the jury that the mere passive receipt of money does not constitute the crime of extortion.

First, under the color-of-official-right theory, the courts have held that there is no requirement that the court specifically instruct on the crime of bribery in an extortion case, even assuming that the two crimes are mutually exclusive, which many courts have denied. See U.S. v. Hathaway, 534 F.2d 386, 395 (1st Cir. 1976); U.S. v. Kahn, 472 F.2d 272, 277 (2d Cir. 1973). As the Third Circuit Court of Appeals held in U.S. v. Addonizio, 451 F.2d 49 (3d Cir. 1971):

Even assuming arguendo that the appellants are correct as to the state of evidence and as to the mutual exclusivity of the crimes (of bribery and extortion) we have concluded that no error was committed, for the court delivered an adequate charge on the legal questions involved. As outlined in VI.A., supra, the essence of the crime of bribery is voluntariness, while the essence of extortion is duress. People v. Dioguardi (8 N.Y.2d 260, 203 N.Y.S.2d 870, 168 N.E.2d 683 (1960)), supra; Hornstein v. Paramount ( Pictures, 22 Misc.2d 996, 37 N.Y.S.2d 404 (1942)), supra. Although the court did not mention the word "bribery" in its charge, it adequately set forth the characteristics distinguishing bribery from extortion. There was no need to instruct in detail as to an offense for which the defendants were not on trial. Bianchi v. United States, 219 F.2d 182 (8th Cir. 1955).

However, as the Government correctly noted, the "defense" of bribery and, hence, the need for the initiate-and-induce language was never offered because Furey asserted that he did not accept money in his capacity as tax assessor but received the money in an individual capacity for private employment purposes. The Court need not charge the jury on an issue not presented by the evidence. See Hallowell v. Keve, 555 F.2d 103, 107 (3d Cir. 1977).

As to the mere passive-receipt-of-money language requested by the defendants, as it relates to the theory of wrongfully acting under color of official right, the Court fully agrees that the mere passive receipt of money does not constitute a violation of the Hobbs Act. See Hathaway, supra, at 393-395; Addonizio, supra at 78. However, the mere passive receipt of money is only one example of the general defense available to the defendants under the Hobbs Act that there can be no misuse of official authority when monies are only received in a private, and not an official, capacity. The Court did charge the jury that the money must be wrongfully obtained under the color of official right, thereby making it inherently clear that money received legally and not under color of official right would not constitute extortion (N.T. 10-15, 16). This defense was a matter more properly raised in greater detail by defense counsel during their closing arguments, which was invited by the Court and which was actually done by defense counsel (N.T. 9-110, 113, 121, 138, 143).

Second, as to the theory of fear of economic loss, the requested bribery charge need not have been given for the same reasons stated by the court in Addonizio, supra. The initiate-and-induce language was not given by the Court, because the Court had already charged the jury that it was necessary, for attempted extortion to be proven under the theory of fear of economic loss, that a reasonable person in the victim's circumstances would have been in fear of economic loss due to the actions of the defendant (N.T. 10-22, 23). Therefore, the "initiate-and-induce" charge was subsumed within the fear instruction. The fact, if true, that Flick induced and initiated the payment would indicate the absence of fear. See U.S. v. Duhon, 565 F.2d 345, 351 (5th Cir. 1978). This would present an example of a lack of fear of economic loss that the defendants were specifically invited by the Court to argue in their closing statements and which, in fact, they did (N.T. 9-118, 123, 124, 137, 138, 139, 140).

Finally, as to the refusal of the Court to charge that the mere passive receipt of money does not constitute extortion under the theory of fear of economic loss, again, this would evidence a lack of fear of economic loss on the part of the victim because he would be passing money voluntarily and not involuntarily due to the exploitation of the extorter of his fear of economic loss. Once again, this was a defense available to the defendants which the Court permitted the defendant to argue to the jury as an example of a lack of fear of economic loss and which, in fact, they did (N.T. 9-118, 123, 124, 137, 138, 139, 140).

III. Mistake of Law as a Defense to the Crime of Extortion

Furey argues that the Court erred in not charging the jury in accordance with his proposed point for charge 10, which stated, in part, that mistake of law can be an excuse under the Hobbs Act.

The Hobbs Act clearly and revealingly does not contain the "knowingly" and/or "willfully" language that brings into play the "specific intent" exception. Furthermore, the legislative history of the statute indicates that, during the passage of the statute, an amendment had been proposed as an alternative to the present § 1951 which did contain the "knowingly or willfully" language but was subsequently rejected by Congress.
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That Congress was aware of the alternate specific intent language but nevertheless did not include it in the presently codified § 1951 clearly indicates that the Hobbs Act was not intended to be a specific intent statute. Other courts have joined in this interpretation of the statute. U.S. v. Warledo, 557 F.2d 721, 729 n.3 (10th Cir. 1977); U.S. v. Green, 246 F.2d 155, 159-160 (7th Cir. 1957); U.S. v. Bryson, 418 F. Supp. 818, 826 (W.D.Okl.1975).

Furthermore, the legislative history of the statute also clearly indicates that Congress intended to enact a strong, broad-based legislative provision that could not be narrowly applied to circumvent the congressional goals of effectively putting an end to the serious problem of extortion, notably in the area of labor racketeering affecting interstate commerce.
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The United States Supreme Court, in Stirone v. United States, 361 U.S. 212, 80 S. Ct. 270, 4 L. Ed. 2d 252 (1960), stated that the congressional intent behind the statute was as follows:

That Act speaks in broad language, manifesting a purpose to use all the constitutional power Congress has to punish interference with interstate commerce by extortion, robbery or physical violence.

Therefore, under the present language of the Hobbs Act, mistake of law is not an excuse for the actions proscribed under the Act and the Court was correct in not charging as requested to by the defendants as to mistake of law.

IV. Requisite Intent Under the Hobbs Act

Furey contends that the Court erred in not charging the jury on the Government's requested point for charge 35, which was endorsed by the defendants and that stated, in relevant part:

FEAR OF ECONOMIC HARM "FEAR"

In Count One, both defendants are charged with attempted extortion and in Count Two, defendant Ronald Furey alone is charged with attempted extortion.

As noted earlier, one theory pursuant to which the Government is proceeding is that the defendants attempted to instill fear of economic harm into the victims to cause the victims to part with money not lawfully due the defendants.

Since only attempted extortion is charged, and not a completed extortion, the Government does not have to prove that the defendants were successful in causing the fear that the victims were actually fearful of the consequences. All that the Government is required to prove when an attempt is charged is that the defendants attempted to cause this fear.

In lieu of that proposed charge, the Court charged the jury as follows:

In determining whether there has been a violation of the Hobbs Act, there are three separate areas of inquiry: (1) the acts that the defendant committed; (2) the requisite state of mind of the victim; and, (3) the requisite state of mind of the defendant. While the defendant's argument concerns the last of the three areas, in order to answer that argument, it is first necessary to understand the interrelationship between the first two inquiries and the third inquiry under the Act.

Attempted extortion through exploitation of fear of economic loss, one theory of the instant action, is committed, first, when the defendant or a third person attempts to instill fear in the victim by the commission of various acts, which could include threat of economic loss to the victim unless the victim bows to the defendant's demands. This is followed by the defendant alone attempting to extort property by exploiting this previously instilled fear in the victim. The victim parts with his property under fear of economic loss consensually, but obviously not voluntarily. Under attempted extortion, the property need not be actually obtained by the defendant, but the jury must find only that it could have been obtained. U.S. v. Sweeney, 262 F.2d 272, 275 (3d Cir. 1959). See also U.S. v. Green, 246 F.2d 155, 159 (7th Cir. 1957). This attempt to wrongfully obtain the property of the victim is another way of saying that the defendant is obtaining the property devoid of any legal right under either state or federal law. Instead, the property is obtained by the exploitation of or playing upon the victim's fear, which in turn induces the victim to involuntarily part with his property to the defendant. U.S. v. Duhon, 565 F.2d 345, 351 (5th Cir. 1978); Addonizio, supra at 76-77; Bianchi v. U.S., 219 F.2d 182, 195-196 (8th Cir. 1955). See also 91 Cong.Rec. 1190 (remarks of Rep. Walter). See generally 31 Am.Jur.2d (Extortion, Blackmail, etc.) § 23 at 916-917.

The victim's fear must be a reasonable fear, under all the circumstances of each particular case. U.S. v. Brown, 540 F.2d 364, 373 n.6 (8th Cir. 1976); U.S. v. Provenzano, 334 F.2d 678, 687 (3d Cir. 1964). In attempted extortion cases, it is not necessary that the victim actually be placed in fear of economic loss but only that a reasonable person in the victim's situation would have been placed in fear of economic loss due to the acts of the defendant or a third person. U.S. v. Frazier, 560 F.2d 884, 887-888 (8th Cir. 1977).

As to the requisite intent of the defendant, it is important to keep in mind that § 1951 is only a general intent statute, as previously discussed, and not a specific intent type of statute. A general criminal intent is required, however. U.S. v. Sweeney, supra at 275 n.3. Therefore, the defendant must have the general intent to exploit the fear or use the fear of the victim in order to wrongfully obtain the property. U.S. v. Duhon, supra at 351; Callanan v. U.S., 223 F.2d 171, 174-175 (8th Cir. 1955). The critical element is that the defendant played upon or exploited the fear of the victim and, by doing so, wrongfully obtained the property of the victim with his consent but involuntarily.

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